charles: a $205 billion deficit in just 28 days. here's the outcry. well, all the guys cying foul and cutting a measly $85 billion a year. >> the longer these cuts remain in place, the greater the damage to our economy. a slow grind b that will intensify with each passing day. charles: welcome, everybody, i'm charles payne in for neil cavuto. and as lawmakers whine about those automatic spending cuts, news our deficit topped $205 billion last month. gina london says if washington is crying over small cuts, how are we ever going to worry about this monster of a deficit?

gina, we want to start with you. this is nuts. i mean, the bigtime money piles up, and we keep looking at this $85 billion which in the grand scheme of things is the proverbial drop in the bucket. >> the drop in the bucket is exactly right, charles. if you look at february of last year compared to february of this year, we went down in our deficit each year from $235 billion last year in 20 the 12 to $205 billion, it's like $25 billion is all we've done with a $600 billion tax hike that we have just paid. you look at those kinds of numbers, you'd have to multiply that times eight, in other words a 4.6 or 8 trillion dollar tax increase on mostly middle class americans just to stop adding to our debt. this is really where we are. these clowns in washington, d.c. make the greek politicians look, you know, really fiscally sound these days. charles charles all right.

linwood, what do you think about that? >> well, i mean, she's right on. $85 billion over seven months, which is what the sequester will cut from march 1 til the end of september, and we ran way over that in one month. and the reason we have to get our debt under control is because that's how we're going to really turn the economy around. our debt is now over 100% of the size of our entire economy, and it's really constraining growth. of it's one reason why we're seeing such a stagnant recovery. charles: you know, ford, i guess at this point can we all admit we do have something of a spending problem? >> well, i think we do, and what it shows is how ridiculous the president's sequester shenanigans were. the deal here is very simple. you know, the president thinks we can tax our way out of this, and he doesn't want to talk about it, and the fact remains if we tax everybody in this country who made over a million dollars this year at 100%, that would only bring us up to $726 billion, and the deficit this

year is going to be 8-900 billion. the bottom line is until we dernize entitlements, medicare, medicaid, social security which are 62 president jr -- 62% of federal spending, if we don't address entitlements, this is going to continue. and the sad part is the president doesn't want to talk about it was by not talking about it, essentially we could wind up devaluing our currency and hindering private sector job growth which is the only way we're going to get people back to work. charles: gina, we just had a jobs number, the president may look at that and say what a robust jobs number, we can spend a whole bunch of money and have a robust economy. >> i wish that were true. it's not that simple, and we all know it. and nobody knows, you know, how those numbers really break down yet. but this is the deal. this is a print and borrow do-si-do that this president has had us on from the beginning of his presidency, and that is his approach to this. americans are going to have to make a decision and, certainly,

the gop in washington, d.c. is going to have to make a decisioning whether they are going to continue this print and borrow do-si-do and just tax people if we're really talking about taxing this tet away -- debt away. and they're going to have some serious spinal cord. charles: maybe, linwood, the answer will be sort of like this payroll tax hike when the new health care taxes can kick in, and we're already seeing where at least 35% of them are going to be paid by people and families that make less than a quarter of a million a year, maybe when it starts to hit main street in the wallet, the people who heard they will be immune to this stuff, maybe that's when the tide turns. >> well, i hope so. look, i have more confidence that the tide is turning, charles. if you look at 2004, government spending wasn't even an issue. and it was still, you know, bush was still spending, and he was spending about as bad as obama. but the point is if you look at

what the public cares about, right behind jobs and the economy is government somebodying. so there's still a long way to go on educating americans on difficulty of addressing this problem by really modernizing the entitlement programs as ford was saying, but i think we've seen americans come a long way since 2004, charles. charles: well, you know, ford, that's interesting because americans have come a long way, and yet the election outcome wasn't much different than four years earlier. and there's still this issue of people not wanting their entitlements to be cut. they're okay with the notion of cutting them but just maybe not mine. >> well, that's theamerican way. unfortunately, if we're actually going to get the debt under control, both parties are going to have to be honest. the gop's going to have to say, you know, have some spinal cord, but also the democrats are going to have to be serious about what the effects are. and we can all sit here and talk about this, but really the folks out on main street really don't know about this. all they know is we've got a serious problem, and nobody's

explained to them why it's eventually going to hit their bottom line. charles: how do you explain that to them in a way that gives them a sense of urgency? a lot of times it feels like, okay, something real bad's going to happen 20, 30 years there now. >> and that's exactly right. and if we don't get this under control, essentially, there aren't going to be any more jobs. a lot of people say, gee, we need to increase the minimum wage because the price of milk's going up. the value of your dollar is going down, and at the end of day we've got to put measuring back on a path to fiscal sanity. charles: gina, i started with you, i want to end with you. the idea that both parties can be, quote-unquote, honest with the american public, is that where i lose all hope? [laughter] >> perhaps. it's definitely going to take some tough talk. and, again, the gop needs to stand their ground, and i really believe this would be the smart thing for them not only economically, but politically. the american people are feeling this. they packaged this as a, this $600 billion tax increase as

supposedly on the rich. we all know this hit social security taxpayers more than anyone else, and most of those people are middle class. so washington, d.c. is lying to us, and if the gop would call out the democrats on this, i believe it would really behoove them to do so, especially -- >> let me say one thing. it's not just the gop calling them out, it's also explaining the problem. we can say the gop has the high ground right now, but both parties really have to be in this together. charles: absolutely. we need honesty, and we need someone to really, truly articulate this. you guys did a fantastic job doing that, and i appreciate it. all right, president obama's reaching out to his honchos. he's calling the top ceos, but not this ceo. the former apple head who's worried the president's talking and taxing too much and cutting too little. but, first, after the tax whack is the big mac getting attacked? why the bad news out of mcdonald's has pele worried that this recovery is in reverse.

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charles: the white house celebrating as some jobs start to return. the economy adding 236,000 jobs last month, and that, well, that's got the administration saying that the recovery is gaining traction. well, tell that to the peeks at google's motorola unit or jcpenney's, those companies cutting thousands of workers, and people are cutting pack, get this, on buying big macs at mcdonald's. u.s. sales fell last month. so from big macs to e. mac who says the economy's still slow, so the white house should show down on the victory lap. al lewis is also with us, but got to star with you, e. mac. maybe too soon for the pom-poms. >> yeah, sounds great, but, you know, when you start revised, of course, the government revised down january by 38,000. the rate of growth in jobs is at

an 18-month low. we're still creating only 191,000 jobs. this really is the worse four-year recovery since the great depression. charles: you know, margie, listen, i think we have become -- because this is the worst postrecession recovery ever -- i think we've become so accustomed to such weak numbers that we do feel great when we get a number. 200,000? wow, that is amazing. but is it really amazing? >> well, we've had 37 straight months of private sector job growth. the last time we had such a strong 37-month record was in the mid 1980s. i mean, i think we're seeing some recovery here that has taken us out of where we were at the end of 2008 which was a really serious and for the whole country. charles: right. >> and i think we've made a lot of ground. now, of course, we're not out of the woods yet. of course, when i talk to voters around the country, i do focus groups around the country, people say i'm struggling. i'm struggling to make ends meet, i'm struggling to stretch out my paycheck, i'm struggling

to pay my mortgage, and that's still true. and it's not until the economy recovers further and unemployment goes down a little bit more that people are going to feel a little pit more optimistic. charles: i've got to tell you, al, i think unemployment's got to go down a whole lot more, and i certainly wouldn't use superlatives like strong to talk about the job market. and instead of focus groups maybe those 4 .8 million people who have been chronically unemployed, there's some things to be worried about here: >> there's a lot to be worried about here, charles. you know, we're still nine million jobs short of where we were pre-recession. and this is really slightly better job growth. we've got the trend right,. but at this rate we're not going to turn to pre-recession levels unemployment until 2017. now, in some ways that's the good news because the only thing good about this economy is our federal reserve keeps dumping money into it, and when they get unemployment low enough, they're going to stop.

so i don't know whether we should be cheering this or maybe a little fearful of this. but the fact of the matter is i think this is business as usual. we always get these strong economic numbers at the beginning of the year, and at the end of the year we're going, wow, that wasn't such a great year. charles: you know what, al? you're young. 2017, no big dal, right, liz? >> he is young. >> i'm not that young. >> you're not too young to remember that this economy -- charles, you've been saying this, too, we've been in bubble territory since the late '80s, and i don't know if the government has realized that this economy has been almost destroyed by five bubbles since the '80s, housing, real estate, dot.com bubbles, so one analyst said it's as if the u.s. economy was or wearing platform shoes for the last 30 years, but the policies haven't been reset to account for that. that's the issue. they've been so used to the numbers coming -- charles: do you think the string

of bubbles is because politicians are so afraid of a hard landing, a short hard landing but a hard landing to readjust that it's always about somehow we've either got to find a soft landing or a false premise or, you know, false facade because we'll be voted out of office? >> yes. and that's why the federal reserve is now on that political fast track. the danger zone is, is that when the economy starts to improve, then the fed pulls back, then the stock market says, wait a second, the federal reserve is getting out of the market, holy cow. they can check in, but they can never leave. that's a dallas fed -- charles: orr the bronx tale, now you cant leave. >> roach motel. [laughter] charles: margie, we spoke with austan goolsbee earlier. i'm not sure if he meant to make this point, but he talked about how rapidly government spending declined last year, and i thought it was entering that as that declined so rapidly, the economy started to build momentum. you'd think maybe at the white

house they may say let's step back a little bit, particularly after the sequestration drama which so far has been much ado about very little. is there possible that there could be a change in course? >> el, i think there are a few things to pay attention to. one is overall views toward how the country's doing, and when you look at voters' overall optimism, it's not where we were before the crash in 2008, but it's improved over where we were just a few months ago, and it's improved over where we were in 2011. so there is -- in 2010. so there is some real improvement there. and also as far as sequestration, i mean, that's really the next real hurdle. because we're only a couple days into it. you have almost a millio mothers, pregnant women and children whose food support might be cut off. you'realking about formula for hungry newborns that might be cut. these are some serious, serious spending cuts -- charles: margie, we're running out of time, and i've just got to say one thing. wouldn't it be better to have a great economy where people could

buy their own food, buy their own milk? they have a job they have pride in, it wouldn't be about whether or not the government could deliver a check to them twice a month? >> i think everyone agrees that that's the goal. but what if somebody doesn't have that job and don't have that food, what should we do? should we do nothing? charles: maybe create an economy -- al, i'll give this to you last, but i think we should just create an economy where this happens and not artificially to your point about the fed earlier. >>ell, the way to do that, charles, is by adding jobs to this economy, and none of the policies that we've pursued so far are adding jobs. so, you know, i don't know. charles: all right. >> we can't just -- >> that's not what the jobs report says. >> real estate prices with free money. the jobs report is pretty lame. charles: let's leave it there. like i said, we're in an age of mediocrity being fanttic. all right, guys. hey, listen, the job withs bill burning down, but you'd never guess what company's rising from the ashes. a former apple see eurozone

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♪ charles: apple and google going their separate ways, each doing a 180. but not a good reversal for apple, down a whopping 63% from its all-time high. google, order, well, it's rocketing and twice hitting all-time highs just this week. and now it's taking apple's seat as the most-owned stock by the 50 largest u.s. mutual funds. the former apple ceo gil amill owe on what's going on. when they were saying apple was going to a thousand, a week later it started to collapse. >> well, you know, the products -- by the way, charles, it's delightful to be with you. charles: same here, thank you. >> let me just mention, if you look at what apple's doing now and in the recent past what they're doing is they're

upgrading the existing product line they have. there hasn't been any new sort of hypnotic kind of new product coming into the market at this time. at the same time, they're also getting serious competition from people like sam supping and the iphone, everybody's coming out with pads of one kind or another, tap lets and soport. and after all, steve jobs is gone now, and it's only natural for people to think that is tim cook up to the job. i think he's very admired, i think he's very capable, but filling the shoes of a steve jobs is very difficult. i think all of those things have weighed against the apple stock. charles: let's talk about the tim cook aspect because this is one that intrigues me a lot. it's hard to quantify the impact, but my point of view, yeah, he's sort of like larry holmes following muhammad ali, but by the same tokennen, gil,

when tim cook speaks, i don't get the feeling he wants to win every skirmish. he wants to lose the war, but if they lose a little battle, i don't get that feeling whereas steve jobs wanted to win every single skirmish, and i think tim cook has lost the confidence of wall street. >> well, i can't comment on that. you'll have to comment on that. i think that he's definitely has a different style of management than steve does. steve, as i know all too well, was a very intense guy. and he took no prisoners. i think tim cook is more of a people person. i think there's a lot of things about that that are good. i think the employees of apple, frankly, like it better. but what he needs to show is that he's going to -- when an issue comes up or when there's lack of performance, he's got to demonstrate leadership s. and so far people are still wondering whether that's happening or not. charles: there have been a couple of hiccups. the iphone launch, the maps, you had a couple key executives

leave. are we getting to a point, though, some sort of major inflection point where they've got to deliver? in other words, before the average investor, not the wall street pros per se, but just the average investor who's hanging in there with apple before even they give up? >> apple is still surprisingly a cheap stock. the p to e is still pretty low. the real issue that they're worried about, i think the street's worried about, is not not -- fundamental business is great. the issue is are they going to have a repeat of, for example, the iphone 5 launch where the spire inventory that apple put on the shelves is gone in one weekend, and then it was another month before they could restock? that definitely doesn't send warm feelings to a lot of people. so i do think they have to sweat the details a little more than they appear to be doing. charles: yeah. and, again, listen, for me execution is, to your point, that's unforgivable, but that's not the longer-term thing that i

think scares a lot of people. in other words, okay, maybe next time they'll execute and have the inventory, how about people just wanting it? i keep hearing stories that demand is down, stories that leak out all the time that maybe they're making fewer ipads this time and this. i mean, almost everything seems that there's a major slowdown. maybe from a stock market point of view it'll be good because expectations on the company will get lower, but they're going to have to do something to wow everybody one more time, no? >> that's exactly what i was saying. i agree with that completely. i think what's happening on the existing product line is that the s curve is kicking in, and, you know, when you're at the beginning of the s curve, it's really glorious. but soonerrer or later that s turns over again, and that's kind of where apple is on most of its products right now. it needs something new and exciting and startling to captivate everyone's imagination and to prove that, you know, tim is up to filling steve's shoes. charles: on that note, startling, something out of left

field, maybe a revolution in watches, maybe a revolution in television. could those be the two places that they show that the p apple magic is still around? >> well, you know, i think they would -- depending, of course, on the details, i think that they would certainly offer that. i think especially on the tv side. the patterns, paver patterns of people relative to tv has changed dramatically with the rise of the internet and other technologies. and the television model hasn't really caught up with that change yet. so i think apple could really do something important here. i think the watch thing is sort of cute, but i'm not, i'm not convinced yet that that will be, that will have a big impact on their earnings. charles: not a dick tracy fan? [laughter] >> well, i love dick tracy. but to be honest, if i had one, i wouldn't use it. [laughter] charles: well, you know what? i don't even know how to use the gadgets i have already.

gil, i really thank you. i appreciate your expertise, and we'll see you real soon. >> thanks a lot. charles: former labor secretary robert rice on a tea party rampage not only saying they're extremists, but claiming they are holding the u.s. hostage. next, the tea partiers tell robert, well, he's just not robert, well, he's just not right, and depress w the american dream is of a better future, confident retirement. those dreams have taken a beating lately. but no way we're going to let them die. ♪ ameriprise advisors can help keep your dreams alive like they helped millions of others. by listening. planning. working one on one. that's what ameriprise financial does. and that's what they can do with you. that's how ameriprise puts more within reach. ♪

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from a former clinton labor secretary, robert rice, writing on his blog. quote: the president should let the public sea the tea partiers for who they are, a small, radical minority intent on dismantling the government of the united states. as long as they are allowed to dictate the terms of public debate, they will continue to hold rest of us hostage to their extreme itch. extremism. katrina pearson and dade webb, as you can imagine, are fuming. katrina, i want to start with you. i mean, the attack on the tea party has been instant, it's been nonstop and, in my opinion, completely unfair. >> well, it's been completely unfair but, charles, the tea party is dead, didn't you get the memo? how do we go from the tea party, a, not even being real to being a political arm of the republican party to being, yeah, it was an organic party but it's dead to all of a sudden being some grand group that's going to take over the government? i mean, even coming out of berkeley, that's insane. charles: well, i think he's

saying they've already taken over government, certainly enough of government to be obstructionist. >> well, you know, obstructionist is a completely different story because it fends on what you're obstructing. and what we witnessed a couple of nights ago when you can't even get the attorney general to say, no, we don't want to kill americans here at home, i mean, we probably should be a little bit more obstructionist moving forward considering we don't know what they're trying to do. charles: you know, david, this kind of language, you know, you and i have talked about this many times in the past, and i see a one-two thing going on here, and i'm going to be completely honest. about a week or so, last week when the president was talking sequestration and all that stuff, he talked about there was one point in his press conference where he says it was just some people down in washington who maybe don't like him, they draw horns on his head. really what i think they suggest sometimes is that these people are motivated through racism, like a lot of people simply in the tea party are racist, they don't like the president, therefore, you can never get any sort of deal done in washington

d.c. so what he'll do is go around and take the guys who maybe aren't racist to lunch every now and then and see if they can work around them. >> well, that's a great sounding attack, but it's not true. let's face it. there are millions of americans who object to this president, there are millions of americans who voted for him who now object to him. they get buyer's remorse. they have to paint extremism, and the if the tea party is this massive group that's so powerful, why are we relevant to their dialogue? because of simple facts, charles. we changed the narrative back to what americans recognize. you can't spend more than you earn. you can't be fiscally irresponsible. you can't run a country on debt and deficit. and the real satire in d.c. or the sad satire is that they turn around and tell us we can borrow our way to success when 77,000 people or so have left the full-time work force this month last month -- charles: here's the thing -- >> and more than that are going on the part-time rolls. charles: i know what you stand

for, i've watched it from infancy. but the public perception, i feel like perhaps the robert rices out there win it with the overtures like this. >> they really are losing. here's where they're losing -- charles: how does the public see the tea party? the average person, do they think they're racist, mean-spirited? >> some of them buy that narrative, but not most americans. most americans fall into i don't know, and that's to be fair. but there are more and more americans who are looking at these pocketbook issues and these kitchen table issues and saying, i get it. what we've done is the most dangerous thing to the administration. we've changed the narrative from government being the provider of first resort to government being the provider of last resort. we want opportunity. we want a federal government within the boundaries of the constitution, a government that does what it was formed to do, protect the nation. charles: katrina, you know, you started off, and i know, you know, obviously, you're being somewhat facetious saying the tea party was dead. it does feel like, though, it's lost a lot of steam from those

midterm election victories a few years back. what the does the tea party have to do in order to redane that momentum and also brand itself instead of letting robert rice brand them? >> well, i think the branding position of the tea party has already been done. you've seen a lot of tea pertiers shift into what we call policy mode. we're actually engaged in the political process. many people are now running for office, many people are now working for candidates existence establishment campaigns which you saw happen right near texas with ted cruz. and i think it's time to really get serious. but as far as branding, something else that we didn't talk about yet that's in this blog is that their painting us as the divisive group in this nation when you didn't see tea partiers pushing grandmas over cliffs, you didn't see tea partiers telling pregnant women they're not going to get to the go to the emergency room. no one is playing any type of us against them with the exception of the liberals, and they're trying to make us own their damage, so it lets us know we're

doing what's right. more people are starting to resonate, and that's getting back in -- charles: i will say this, david, but i think you guys are both right with respect to people starting to get this in part because they are feeling it. all of these people promises were made to, i won't hurt you, i won't hit you, i'm just going after those rich guys, well, there's a payroll tax hike, there's a paying for obamacare. so regular people, david, are starting to feel this, and i know ultimately that does help your cause. but between now and a gigantic epiphany in this country, what happens? >> with we need to debate that robert rice doesn't want, the administration doesn't want. robert rice won't debate on the merits, keynesian versus austrian, insert whatever term you want. they don't want the debate, they want to stifle it. the tea party says let's have the debate. our elected officials are hired by us to do the job, then let them go up and do their job. charles: they're not going to have the debate, it's so much easier to defeat you guys with the help of the media and

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>> well, first, thank you so much for having me. and the bill does not talk about the purchase of ammunition. it's a public safety bill, actually, first that says we will put into statute the same waiting period for all firearms that we have for handguns. the other part of the bill talks about the fact that, um, before the purchase of ammunition, anyone purchasing ammunition would take a two-hour what i call an introspection anger management class. two hours, you can take it online, at your house, you don't have to go anywhere. it's not pointing fingers, it's not -- charles: well, it is pointing fingers in a sense that, you know, since newtown it's felt like almost any legal gun owner has, it's sort of like if you're not for all of these incredible

changes to the laws, perhaps even the constitution, that you are de facto aiding and abetting any mass shooting. and it's felt like this from immediately, like there were people out there who never did like the second amendment, and they found an opportunity to go ahead and make this sort of harsh, you know, move against people who rightfully own guns. and by the way, 99 percent of these lawful gun owners don't commit any crimes. so i do think it is finger pointing -- >> well, if you let me say something, i don't know about the other people, all i know about is this legislation -- charles: but what's the purpose for the anger management course? >> it doesn't point fingers at anyone. it does not ban any guns. it does not ban any ammunition. it just says let's look inside and see what triggers, what triggers may be, may be that would cause me to reach for my

gun. charles: okay, senator gibson, what if i have an anger management issue? can i have a gun? i've never committed a crime, i've never hurt anyone, but i fly off the handle every now and then. can i have a gun under your rules? >> the rule doesn't say you can't have a gun. it has nothing to do with that. charles: then what's the purpose of it? >> take the course, take the two-hour course, print out the certificate, keep your certificate in order to be able to buy ammunition. for ten years. it's good for ten years. because the bill is not designed to be prohibitive. charles: well, it sounds like it will be prohibitive, and it sounds like it's going to label people. >> it doesn't label anyone. charles: would you propose doing the same thing for people who want to buy a car? enter -- >> we have road rage laws for people who act out in their cars. charles: we have a lot of laws for people once they've committed a crime. i'm talking about before they buy a car, because people have

done a lot of damage -- >> well, let me tell you this, let me tell you this. the, um, legislation that i proposed doesn't suppose that someone's going to commit a crime. that's not it at all. charles: what is the purpose -- >> it doesn't presuppose that. charles: what is the real purpose, the honest purposesome yeah. >> the purpose -- charles: to demonize people in. >> the purpose that i said in the beginning is public safety and introspection. so there may be -- charles: what does that mean though? i don't understand what you're saying. >> i described it. charles: i don't get it. so you want to feel comfortable, you want to feel comfortable judging who might want to buy bullets out there? you want to have -- >> the bill doesn't, the bill doesn't judge anyone. it simply lays out to purchase ammunition -- anyone, anyone, anyone can take the two-hour anger management class -- charles: and, of course -- >> get the certificate and print

it out. charles: like a had lot of these things that have been suggested, the criminals, the people who go out there and shoot people every day and shoot innocent bystanders, of course, they'll never take one of your anger management courses, will they? >> well, then they will never get any ammunition. charles: oh, they're going to get it, they get it now. >> all right, thank you. charles: thank you very much. >> you're welcome. charles: well, the president breaking bread with lots of republicans lately, but that could actually cost you lots of bread. the washington legend worried more tax hikes are on the menu. ♪music plays thank you orville and wilbur... ...amelia... neil and buzz: for proving there's nowhere we can't go. but, at some point... giant leaps gave way to baby steps... and with all due respect, you're history. if you taught us anything,

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charles: well, the scare tactics didn't work, but looks like the charm tactics might. because now senate republicans

are open to working with the president after getting wined and dined by the president. and many of the gop are worrying that means they'll join john mccain and lindsay graham in being more open to revenue. former democratic senator bayh on dorgan hopes that's true, he says more revenue's needed. he's joined by former republican senator bob bennett. senator dorgan, we want to start with you. listen, i guess after clubbing the republicans, beating 'em up pretty good the charm defense -- offensive, rather, with was -@maybe the last arrow in the quiver, but you think it might work. >> well, what i hope will work is that people talk about these issues, significant and serious issues the country faces, and describe conditions under which compromises can be reached. fact is, we need to solve these problems, and the lack of going back and forth and trying to find common ground has not been very beneficial. so i think what is going on now is fine. and, by the way, in order to solve these deficit problems, we

have to do a little of everything. you need restraint, you need entitlement reform, fiscal restraint, spending restraint, and you also need some additional revenues. charles: and with all due respect, everyone says that. that's the answer that every single person on both sides of the aisle, for the most part, will say. and yet when it comes to cobbling some sort of a deal together, we dot necessarily get that. i agree that maybe breaking bread isn't so bad. certainly it's better than going on tv or across the country in campaign style, but having said that, senator bennett, compromise means that both sides give up something. what do the republicans think the president should give up? >> well, compromise doesn't necessarily mean like a financial deal, okay, let's split the difference between these numbers. compromise can mean look at my problem, and i will look at your problem, and maybe we can come to an agreement here. not a compromise that sacrifices anything, but a recognition that the other guy may be right.

one of the problems here is that neither side is willing to give the idea of good faith to the other, and as a consequence you get expressions of bad faith on both sides and then accusations of bad faith poisoning the well which makes it impossible to make any kind of a deal, even one on which both sides could agree. it's the poisoned atmosphere here that's the problem. charles: so i like the way you framed that, but if that is the case and both sides are adamant about their belief system and they can't be swayed, should compromise be like a financial deal, not necessarily a 50/50 split, senator bennett, but perhaps i've got to give up something in return for something else? >> well, let's take a look at what's now going on in the controversy over the closing of the white house to tours. as people on the right are coming up with a whole list of things that they think could be shut down by the government and make more sense than shutting could be -- shutting down the

tours. why didn't they put those in a piece of legislation and send it to the president for his signature or his veto instead of driving us to a sequester which takes the congress out of it entirely? it's now -- the congress by pushing to the sequester has put the president in a position where he has complete control of what gets cut and what doesn't. and now they're not liking what he's deciding. but they're the ones who gave him the power to decide. they should have said, okay, mr. president, these are the kinds of things we think should be cut and then have him look at some of them and say you may very well be right. that may be a dumb thing, and that's how you get a deal. not this kind of tremendous confrontation that's been going on. charles: righ i guess, senator dorgan, on that note they feel like, okay, the president -- with some of these things it feels like false shenanigans, a lot of volunteers do the tours, the guy in charge of the operation just got a massive pay increase over the last few years. when the public learns about things like this, maybe they win

a little bit of a public relations victory. maybe this is what the problem is, maybe they're too busy trying to score public relations points and not getting down and cobbling something together. but do you agree, senator dorgan, with the idea that compromise isn't a financial compromise but somehow persuading the other side to adopt your ideology? >> well, first of all, nobody's scoring any points here. i mean, my gosh, the sequester is an assault on common sense. it's thoughtless. so neither side's scoring common, you know, scoring any points. i just think we shouldn't be suspicious of people that want to compromise. that's -- the lubrication of democracy has always been when people think differently about issues, sit down at the table and can try to come to some resolution. what's happening now is there's no resolution on anything because there's complete, total gridlock. let's not be suspicious of attempts to find common ground. charles: do you agree, though, at the end of the day when it's all said and done, the president

is the one who somehow has to find a way to bring both sides of the aisle together on these critical issues? >> well, the president should do that, but be you're going to have pares dancing, you've got to have a pear. and i think all sides need to understand the country's sick of this. the country's fed up with grid lock. it's time for people to sit down and understand that we all wear the same jersey, usa, let's fix these problems. charles: gentlemen, thank you. senator dorgan and senator bennett, maybe you guys can come back and whip these guys into shape because as of right now it doesn't look too good, but we appreciate your time, and i learned a lot. thank you. >> thank you. charles: well, everywhere you look, you're going to have to pay up. taxes are going up on gas, on taxes are going up on gas, on income, now maybe even e-mail? this is $100,000.

taxes are going up on gas, on income, now maybe even e-mail? we asked total strangers to watch it for us. thank you so much. i appreciate it. i'll be right back. they didn't take a dime. how much in fees does your bank take to watch your money? if your bank takes more money than a stranger, you need an ally. ally bank. your money needs an ally.

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when you drive. one of them peddling a tax on people who ride bikes. and now california councilman wants to tax e-mails and to take that money to fund the cash-strapped postal service. i kid you not. liz macdonald sees a trend here, states increasing taxes in a sneaky way to increase their spending. margie and al are back with us. liz? >> it almost makes you think state officials are thinking what can we tax next? it's like the train of thought there is making all local stops. let's see what else we can tax. by the way, you're probably going to need more wiewr accurates to -- bureaucrats to collect that e-mail tax. so this is sneaky, and the real danger for taxpayers when they enact these taxes is that they say, listen, 're going to replace the income tax, lower the income tax, the sneaky danger is those taxes stay in place, and income tax either goes up or goes back. if they try to abolish it. charles: and we've seen this kind of stuff before. you know, margie, this sort of

hints at this entitlement cull chair that we must have a post office, x amount of branches, and it must lose $5 billion a year and someone's got to pay for it. this is absolutely nuts. >> well, it's just one city council per's plan. i mean, look, i don't think you're going to see a groundswell of support for an e-mail tax. i would have to sell some of my shoes just to pay for the tax while i've within sitting here in the studio -- i've been sitting here in the studio. so i don't think you're going to see that take off at all. charles: but, al, it is interesting though that when in doubt, look for a new tax. i mean, this is how politicians go about their job these days. >> well, somebody's going to have to pay for that 2008 financial crisis, and i think sneaky little taxes and ideas to raise revenue are going to be the order of the day for years to come. but if you want to fix the post office, you know, reracks the pension restriction -- relax the pension restrictions that congress put on them in 2006, maybe cut back saturday delivery

as the postmasterrer general himself has proposed. and you know what you tax? tax junk mail. an increasing amount of their business is junk mail. just tack that. concern just tax that. charles: that's the only business they're doing. you want to end up in that business too? deficit? that is the only business that is working. >> with the gas tax is entirely different because some have not raised it in a couple of decades. they went to improve the roads they think it e-mail tax will not happen spee met

with the housing collapse what stayed in place? property taxes never went down. and i would say if you want to be reelected, a stop taxing your citizens and look up the books for what you could cut out there is a lot of fat. charles: unfortunately, there's always something they see we can spend money on. there's always something. >> improving roads in reducing traffic is always something that people look to spend money on. charles: that is why i paid my tolls. >> not all metro areas have tolls see you are in favor of mortals? voters sul